Dubai, UAE, January 11, 2018: Sanjeev Gupta's GFG Alliance today marked the started of a major expansion into continental Europe by launching a €2billion investment programme in France.

As part of this programme, GFG's industrial arm Liberty House has made a binding conditional offer to Rio Tinto to buy Europe's largest aluminium smelter based in Dunkerque, France.

The offer triggers a statutory consultation with employees, European Works Council and stakeholders and, subject to a successful outcome to this process, Liberty says it has ambitious plans to invest and develop the 570-worker plant, potentially creating thousands more jobs on-site and in the wider economy.

In addition to serving existing customers with aluminium slab and ingots, Liberty wants to capitalise on the growing market for aluminium components among Europe's vehicle manufacturers by working with stakeholders to develop downstream manufacturing activities linked to the smelter at Dunkerque.

It is estimated that the total aluminium content in European-made vehicles will rise from 3.3m to 4.3m tonnes a year by 2024 and that the global use of aluminium auto body sheet will more than double in the next 10 years. This is driven by the trend towards lighter-weight vehicles with a lower carbon footprint.

Today's announcement follows recent confirmation that Liberty is engaged in a formal bidding process to acquire Asco Industries. Asco has steel mills and service centres at six locations across France, employing around 1,500 people. The Asco business is similar to Liberty's Speciality Steel's business in the UK, where the operation is a key supplier to the UK automotive and aerospace sectors, and is a core part of GFG's GREENSTEEL vision and long-term strategy.

The company said it is attracted to invest heavily in France by the very pro-business environment being created by the Macron Government.

Referring to the Dunkerque agreement, executive chairman of the GFG Alliance, Sanjeev Gupta said: “Our detailed analysis leads us to believe that Dunkerque is the best location to drive forward our downstream automotive strategy. Aluminium Dunkerque has a high-quality aluminium operation benefitting from a top-class workforce and management. This will be our key strength when embarking on our ambitious plans. Subject to the outcome of the consultation process we look forward to welcoming the team and local community into the global GFG family on completion of the sale.”

Mr Gupta added: 'We want to develop the plant into an international centre of aluminium and downstream aluminium products expertise, demonstrating our GREENALUMINIUM strategy. This investment will help fulfil our ambitions in the sector, further enabling us to capitalise fully on expected growth in demand for aluminium over the coming years.

“In 2016 we acquired Rio Tinto's Scottish operations, working in partnership with the Scottish Government, where are now building a high-value-added automotive components plant. We look forward to building an equally productive partnership with the French Government.”

'This is GFG's first significant step into continental Europe, which we will hope to build on. We are particularly attracted by the pro-business environment that President Macron's France is quickly building. This has motivated our ambition to establish a global hub for the group in France, not only investing heavily in aluminium, steel and automotive, but also bringing our other divisions including energy, banking and property development to explore opportunities in France and Europe, also complementing and supporting Dunkerque.”

Alf Barrios, Rio Tinto's chief executive Aluminium said: “The binding offer for the sale of Aluminium Dunkerque represents the best option for the future development of the site while also delivering value for Rio Tinto as we continue to streamline our portfolio. Liberty House has a track record of investing in similar assets, which should secure a long-term sustainable future for Aluminium Dunkerque and continued economic benefit for the wider community.”.”

Liberty acquired Rio Tinto's aluminium smelter at Lochaber in Scotland in December 2016 and is currently investing £120m to modernise and expand the plant, including the addition of an adjacent alloy wheels factory that will use primary aluminium made on site, creating around 400 direct jobs and a similar number in the supply chain and regional economy.

The binding offer for Aluminium Dunkerque triggers a sale process that includes statutory consultation with employees, relevant European works councils, stakeholders and partners. It is anticipated that the process will be completed, and the sale concluded during the second quarter of 2018.

The GFG Alliance is being advised by a group of firms led by Lazard

Posted by : GoDubai Editorial TeamViewed 11682 timesPosted on : Thursday, January 11, 2018
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